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6. The risk free rate (Rf) is 2 %. The average return in the market (Rm) is 7%. The = 1.5. The market value of

6. The risk free rate (Rf) is 2 %. The average return in the market (Rm) is 7%. The = 1.5. The market value of equity is 200,000. The firm has 300,000 debt (market value) and pays 8% interest. The corporate tax rate is 35%. The WACC is: a. 6.12%

b. 6.92%

c. 7% d. 7.4%

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